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What Is a Trust Protector and When Might You Need One?

Posted by Aubrey Sizer | Mar 16, 2021 | 0 Comments

Trust protectors -- long popular in offshore trusts set up by high rollers -- are growing more common in trusts established here in the U.S. by less affluent folks. A trust protector is someone who is appointed to watch over a trust that will be in effect for a long time and ensure that it is not adversely affected by any changes in the law or circumstances.

There are a number of reasons for appointing a trust protector. Having a protector allows a long-term trust to be more flexible and adapt to factual and legal changes. For example, beneficiaries may get divorced or die prematurely or the law may change. A protector can also be helpful if you believe there may be conflict among the beneficiaries and the trustee or if you don't fully trust the trustee to fulfill your wishes.

You can name a trust protector in your trust document, which will also dictate the trust protector's powers. Here are some powers that a trust protector may be given:

  • Remove and replace a trustee
  • Allow the trust to be amended due to changes in the law
  • Resolve disputes between trustees (if there is more than one) or between beneficiaries and the trustee(s)
  • Change distributions from the trust based on changes in the beneficiaries' lives
  • Allow new beneficiaries to be added if there are additional descendants
  • Veto investment decisions

Whatever powers the trust protector has, you should be as specific as possible in the trust document. The more specific you are, the more likely your wishes will be carried out. An attorney can help you ensure that the trust protector does not have too much power.

Technically, anyone can serve as a trust protector; however, it is a good idea to appoint an independent third party rather than a family member or a beneficiary. A lawyer or accountant may be a good choice. There are also companies that provide trust protector services.

About the Author

Aubrey Sizer

Aubrey Carew Sizer is a member of the Virginia State Bar with a practice focused on estate planning and elder law, specifically, long-term care planning, special needs planning for the disabled, guardianship and conservatorship, and probate, estate and trust administration.

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Attorney Sizer provides customized and affordable estate planning (including wills, living trusts, powers of attorney, and advance medical directives); elder law services (including long-term care planning, special needs planning for the disabled, and guardianships and conservatorships); probate, estate and trust administration (including advising executors and administrators of estates about post-mortem planning and the local probate process in Virginia), as well as general aging and disability advice in Northern Virginia, including but not limited to Arlington, Alexandria, Ashburn, Bristow, Burke, Centreville, Chantilly, Gainesville, Fairfax, Falls Church, Haymarket, Herndon, Leesburg, Manassas, Manassas Park, Reston, Springfield, Sterling, and throughout Loudoun, Prince William, and Fairfax counties.

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